Behind the Money: Hybrid Funds Appeal to Institutions

Oct 15th, 2006 | Filed under: Hedge Fund Industry Trends, Institutional Investing

By: Chidem Kurdas, HedgeWorld
Published: October 11, 2006

Don’t be fooled by the title of this article – it’s equally as applicable to individual investors since it addresses alpha-centric investing in the form of hybrid (i.e. 1X0/X0) mutual funds.

“Hedge fund strategies in mutual fund format allows institutions with less than $5 million in assets to add diversity to their long-only portfolios, he pointed out. These do not qualify for privately placed hedge funds.

“ In addition, open-end funds have a major advantage over both regular hedge funds and closed-end registered products: daily redemption. With that, the investor’s portfolio can be rebalanced easily to keep investments at their target allocations. By comparison, moving money in and out of hedge funds typically takes more time and work, even when there is no lock-up.”

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  1. Tuesday links: Chicago stories « Abnormal Returns October 17th, 2006 3:06 pm :

    [...] All About Alpha on the appeal of “1X0/X0″ strategies to mutual funds, nee hybrid funds. [...]

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